At least three Wellington City Council staff have been dismissed for fraudulently misusing council-issued charge cards - and one case of fraud has been referred to police.
However, the council has deemed it unnecessary to conduct a full audit of all charge card transactions.
Chief executive Kevin Lavery confirmed there had been one case of fraud referred to police, who said one person had appeared in the Wellington District Court, facing a charge of using a credit or bank card for pecuniary advantage.
Lavery said the council would not conduct a full audit of all transactions on the 172 P-cards issued to selected staff.
"An audit of controls around purchasing card systems has already been completed and no additional action is required."
It was "very rare" to have serious misuse of charge cards, sometimes known as purchasing or P-cards, and used to buy authorised goods and services for official council business.
"However, we have had one case of fraud. The investigation process has resulted in staff departures and a referral to police.
"We are not prepared to identify individuals, amounts or the details of any investigations undertaken into this matter except to say that, when identified, action was taken swiftly including full recovery."
The Dominion Post was leaked a copy of the council's audit of staff expenditure, undertaken after the fraud was identified. It did not identify any further fraud, but did highlight concerns over lax authorisation processes.
The cards are not issued to elected councillors.
The audit reviewed an undisclosed number of P-card transactions to check that expenses were for genuine business purposes, that council's expenditure policies were followed, and that the expenses were coded to the correct expense accounts.
An issue identified was that managers' expenses could, at their request, be clocked up on P-cards allocated to their executive assistants. Those transactions could then be approved - essentially self-approved - by the same manager.
Lavery said new controls were now in place. "Such cases now require the chief executive to counter-sign all executive assistant cards. Existing controls for the chief executive's office do not require amendment as robust management controls and checks already exist."
Of the audited transactions, 82 per cent had an issue associated with them, of which 29 per cent had multiple issues.
These included 17 cases lacking information to determine whether the expenditure was for a genuine business expense, eight cases in which catering and coffee expenses had no detail on the number of participants or who attended the meeting.
There were also six cases in which there was no receipt on file to confirm the items purchased, and four cases in which the council's $40 gift policy limit was exceeded. This included two cases of flowers and two cases of gift cards.
Lavery said all recommendations in the report to tighten P-card controls had been accepted by the executive leadership team and were being actioned.
- The Dominion Post
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